French Market credit card policies assessed by New Orleans inspector general

After an investigation prompted by reports last year about questionable credit card purchases by the former director of the French Market Corp., New Orleans Inspector General Ed Quatrevaux released a report Thursday night outlining several problems with the city agency's financial policies.

View full sizeTed Jackson, The Times-Picayune archiveThe French Market was photographed in September 2009.

In the meantime, though, the agency has gained a new director and an almost entirely new board, and it has revised the policies criticized in the report.

Former Director Kenneth Ferdinand resigned under fire last summer because of complaints about his management style and questions about purchases he charged to the agency.

Landrieu said last year that Quatrevaux's office had been asked to review any "questionable expenses" and "questionable practices" at the French Market during Ferdinand's three-year tenure.

At the time he resigned, Ferdinand agreed to repay the agency $5,000, although questions reportedly had been raised about as much as $20,000 in expenditures.

The nonprofit French Market Corp. oversees operations of the city-owned French Market, which dates back to 1791 and bills itself as America's oldest public market. Its tenants include food and other shops, restaurants, a farmers market and a flea market. The market's staff also manages the city-owned Upper Pontalba Building on St. Peter Street facing Jackson Square. The building contains apartments and first-floor stores.

In its report on the French Market's credit card and expense reimbursement policies, Quatrevaux's office said it found that:

The agency lacked a written credit card policy.

Employees did not consistently provide supporting documentation or identify the business purpose for expenses.

The agency often incurred finance and late charges on monthly credit card statements.

The audit also found that the French Market provided gift cards to employees in violation of the state Constitution, failed to account for them properly under federal tax guidelines, and sometimes split purchases of more than $2,000 to reduce their size and thus avoid having to get a second authorizing signature.

For the period from July 1, 2007, to July 31, 2010, the report says, 32 percent of the credit card transactions tested lacked supporting documentation and 50 percent did not adequately explain the business purpose of the expense.

In a May 26 letter to Quatrevaux, Pizzolato said the agency has taken steps to end all the abuses cited and implement new policies.

The report never mentions Ferdinand and does not deal with specifics of the allegations against him, for example that he used a French Market credit card to buy items not related to the agency's operations.

In a statement issued Sept. 30, Chief Administrative Officer Andy Kopplin said that after Landrieu took office in May, "numerous issues were brought to our attention regarding the French Market Corp. As a consequence, the executive director resigned in July. We are in the process of putting a new board in place and have turned over documents we received to the inspector general for further investigation."

However, it was later reported that the administration waited two months to refer to Quatrevaux allegations that Ferdinand had misspent as much as $20,000, although Deputy Mayor Greg St. Etienne was present when Ferdinand agreed to resign and make a donation to the agency of $5,000.

A July 28 email message from St. Etienne suggested that the administration hoped the Ferdinand episode would fade away without attracting public notice. St. Etienne said Ferdinand wanted him to know "that he did nothing wrong and wanted to ensure that his reputation was not sullied." He added, "We assured him that we wanted this to be a nonevent in which he chose to take a different career direction."

Ferdinand submitted his written resignation July 29. But his alleged misspending, discovered by members of the French Market's unpaid board, was not turned over to Quatrevaux's office until Sept. 30, when the allegations were first reported in the news media.